How To Choose A Luxury Condo

The luxurious condo market, just like any other niche, has its own quirks and tricks. It isn’t as different from choosing a detached home as some real estate agents suggest, but the condo market does have its specific traits.

As luxurious condominiums are highly valued investment properties, there’s a unusual pressure on both the buyer and the seller. Different states and cities have their own regulations that forbid excessive speculation and keep prices between reasonable constraints. However, development is very intense in large cities and you should think about what long-term “killer features” could both secure the value of your new investment and make it super fun to live in.

As someone buying the condominium to live in you have an advantage over the speculator, in that you can enjoy features which are not just related to the value of the property.

The Killer Feature

Here are some questions you have to ask yourself before considering buying in any given condo building:

• What is so special about the property?
• Is it only the location?
• Are there any features that other developers are unlikely to offer nearby in the foreseeable future?

Traditionally, the most valuable unit in the building is often the penthouse, as the penthouse is positioned higher and isn’t threatened by being eclipsed or enclosed by other buildings in the future. End units at the sides are also more expensive as they feature more windows and unique interiors. Many of these condo buildings have been designed by award-winning architects. Some will have celebrity tenants and will get featured in the press on their own, further increasing the value.

Speed & Agility

Many high profile condos are sold out long before the construction work begins on the building itself and reselling happens just as quickly. Therefore, limited financial agility will make it hard for you to act at the right time. This is where a good buyer’s agent can help. You should look for a specialist who has extensive experience in the area and a wide network of contacts with access to privileged information, often resulting in preferential treatment when placing offers.

Make sure to get yourself preapproved for a mortgage as well.

Different Economics

Small dips in the market will often not affect luxurious buildings as much. The people who can afford these units can continue to live well regardless of limited economic turbulence. However, a major economic correction as we are seeing now at the beginning of 2009 will affect prices. How much remains to be seen.

Potential buyers are often required to make non-refundable deposits, deal with phase pricing, title insurance intangibilities, leasing rules, lender challenges and a wide range of policies regarding every thing you could think about. Because of this, you need to be aware of your exact spending limits and the real-world prices of these properties.

There are numerous extra costs involved that will require you to do a bit of research and background checks before you’re ready to proceed. Ask about all the above and require a clear, short summary of the costs from the sellers. When you have this, add an additional 3-5% to the totals to have a reasonable picture of what you can expect after moving in and doing any necessary limited fitting or repainting.

The Amenities

Amenities should be a part of the “killer feature”, but more often this is not the exact case. You’ll likely have the fitness centre, the 24-hour guard, various wellness and lifestyle-oriented services such as massages, saunas, small-scale swimming pools and similar features that are located in the building itself. These are great, but often heavily compromised – not nearly as good as a dedicated pool or health club. Exceptions exist but remain exceptions. The real challenge is finding a place where you’ll have the city’s best within 5 or 10 minutes of walking or other convenient methods of transportation (ie. not by car where parking is an issue). If you can manage to find the sweet spot between all these, you might have a winner.

The Agent

All the described above comes from many years of my own experience as a realtor focusing on high profile, luxurious condominiums in Toronto. While it is possible to search for a suitable home or investment property on your own, chances are that it will not be an easy journey without mistakes. A good luxurious condominium agent will keep all of the factors above in mind and will be able to help you make wise choices and prepare offers more quickly. Prudence dictates finding a great specialist to take care of your next great condo. To find that great agent, check a real estate agent’s track record and his or her familiarity in the neighbourhoods which interest you.

And if you don't know where to start, maybe my guide through Toronto Condo Neighbourhoods would help!

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